[USER]

I am 33 and just starting my fire journey (but I’ve been investing since I was 18!) I have $499,000 between my 401K, brokerage, and IRA.

I also have $67,000 in my savings.

I just used a compound interest calculator to see what this would be worth in 30 years with a 10% return.

The calculator came up with ~8.7 million (not including my savings).

Does this sound correct?? It sounds higher than what I expected.

[Russ]

Russ Tyler
It is sound. This is without adding additional funds.

Being in your 30’s, it may be advantageous to convert your IRA and 401k to a ROTH IRA.

Still get the 10% return and you probably would still be in the 8 million ball park in 30 years.

If you keep contributing you probably will wind up with significantly more than the 8.7 million.

You would end up with more than 8.7 million if you kept the status quo too.

But significantly less taxes in 30 years.

[Ellen]

That sounds right. Compound interest is a beautiful thing.

[Gonzalo]

Accounting for inflation, I often use 8% or even 7% (not 10%) when I do my calculations.

[John]

You should run the calculator with 7-8% return max and see where you get.

That’s is likely the max after tax gain you will achieve.

[Yujin]

Sounds right, but remember that anything can happen between now and then.

So take that calculation as an estimation.

[Bassel]

Good start! Compounding is powerful. You can’t count on 10% returns for 30 years.

[Jake]

Yes. Compounded growth rate of 10% pa over 30yrs on $500k is ~$8.7M
However you’ll probably havev1 bad year for every 4-5 great years.

And as you get older, you may want to transition to a more defensive/ less volatile mix of assets

[Tom]

Just my perspective.
At your age, my wife and I were living in a tent on the national Forest. We had $20 cash in our pocket.

Fast-forward 30 years with admittedly, a low combined income.

We are now comfortably retired with a withdrawal rate of less than 2%.
You can do this.

Intentionality is a powerful thing.

[Author]

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